DeepSeek's AI claims have shaken the world — but not everyone's convinced
Chinese artificial intelligence firm DeepSeek rocked markets this week with claims its new AI model outperforms OpenAI's and cost a fraction of the price to build.
The assertions — specifically that DeepSeek's large language model cost just $5.6 million to train — have sparked concerns over the eyewatering sums that tech giants are currently spending on computing infrastructure required to train and run advanced AI workloads.
Investor fears over DeepSeek's disruptive impact erased close to $600 billion from Nvidia's market capitalization Monday — the biggest single-day drop for any company in U.S. history.
But not everyone is convinced by DeepSeek's claims.
CNBC asked industry experts for their views on DeepSeek, and how it actually compares to OpenAI, creator of viral chatbot ChatGPT which sparked the AI revolution.
Last week, DeepSeek released R1, its new reasoning model that rivals OpenAI's o1. A reasoning model is a large language model that breaks prompts down into smaller pieces and considers multiple approaches before generating a response. It is designed to process complex problems in a similar way to humans.
DeepSeek was founded in 2023 by Liang Wenfeng, co-founder of AI-focused quantitative hedge fund High-Flyer, to focus on large language models and reaching artificial general intelligence, or AGI.
AGI as a concept loosely refers to the idea of an AI that equals or surpasses human intellect on a wide range of tasks.
Much of the technology behind R1 isn't new. What is notable, however, is that DeepSeek is the first to deploy it in a high-performing AI model with — according to the company — considerable reductions in power requirements.
"The takeaway is that there are many possibilities to develop this industry. The